I recently participated in a panel discussion on property appraisals and taxes at the Texas Farm Bureau Legislative Conference. Other panelists represented the Governor’s Commission on Appraisal Reform and a taxpayer association. Since my time was limited, I prepared the following information for the participants.
If property is appraised at a higher value, do the property taxes automatically increase? No. To collect more taxes, the political subdivision must publish two newspaper notices, hold two hearings, and adopt a motion to increase taxes by a record vote. There is no hidden appraisal tax creep in Texas.
What actually causes higher appraisals? The local appraisal district is required by the state of Texas to appraise property within 5 percent of market value. Failure to meet this standard results in financial penalties on local schools by the state.
Is the present appraisal system fair? Unfortunately, no. Studies have shown that residential property is consistently appraised closer to market value than commercial and industrial property. This shifts the tax burden to homeowners. Mandatory sales price disclosure would help.
Who collects property taxes in Texas?